Tesla jumps 8% after Elon Musk acquires EV maker's shares worth $1 billion

Tesla jumps 8% in pre-market trading after Elon Musk acquires EV maker's shares worth $1 billion

Tesla shares jumped about 8% in premarket trading on Monday after a regulatory filing showed that CEO Elon Musk had purchased nearly $1 billion worth of the electric-vehicle maker's stock last week.

Musk disclosed buying 2.57 million shares in open-market transactions on Friday, paying between $372.37 and $396.54 per share, according to the filing.

Tesla shares jumped more than 7% on Friday, extending solid gains from the previous session. The stock, which has fallen about 2% so far this year, is on track to record a third straight session of gains if premarket moves are sustained.

Investor sentiment on the automaker has been dampened by faltering EV demand, as well as Musk's focus on politics.

On Friday, Tesla board chair Robyn Denholm dismissed concerns that Musk's political activity had hurt sales and said the billionaire was back "front and center" at the company after several months at the White House.

The stock purchases coincided with Denholm speaking with reporters about the merits of awarding Musk upwards of $1 trillion worth of stock if the company achieves a series of ambitious market value and performance milestones.

Musk, 54, last bought Tesla stock in the open market in February 2020, according to data compiled by Bloomberg. He offloaded more than $20 billion of the company’s shares in 2022, the year he acquired Twitter.

The purchase amounts to a show of confidence in Tesla’s prospects after a challenging first half of the year in which vehicle deliveries slumped 13% worldwide. While Musk has talked up Tesla’s pursuit of robotaxis and humanoid robots, he’s also cautioned that the company could be in for “a few rough quarters” after the US phases out electric-car purchase incentives at the end of this month.

Musk is the world’s richest person with a net worth of about $419 billion, according to the Bloomberg Billionaires Index.

With inputs from Bloomberg